Long-Term Impact of Good Teachers

Does having a good teacher have long-term effects on student outcomes? The answer, according to a sophisticated study tracking over 1 million students from a large urban school district from fourth grade into adulthood, is a resounding affirmative answer.

The authors found that students who were fortunate to have been assigned to high value-added teachers experienced the following positive outcomes:

More likely to attend college,

Higher probability to attend higher-ranked colleges,

Earn higher salaries,

Live in higher socio-economic neighborhoods,

Save more for retirement

Less likely to have children as teenagers

The effect of a good teacher on lifetime earnings is substantial. If a low value-added teacher in the bottom 5% is replaced by an average teacher, not even an excellent one, the expected increase in the present value of students lifetime income is more than $250,000 for the average classroom in the study.

The authors determined that rational parents should be willing to pay approximately 25% of what they expect their child’s income to be at age 28, providing they can switch their children from a 25th percentile teacher to a 75th percentile teacher.

Substantial economic benefits accrue to students who are fortunate to have good teachers.

Supporting Research

Effect of Good Teachers on Students Lifetime Earnings

Analyzing the impact of good teachers (based on student achievement) and the impact of student achievement on lifetime earnings, Eric Hanushek estimates a good teacher (one in the top quarter in terms of effectiveness) each year produces over $350,000 more income for his/her students compared to an average teacher. On the the other hand, a poor teacher (one in the bottom quarter in terms of effectiveness) subtracts $350,000 in income each year of teaching compared to an average teacher. A good teacher at the 84th percentile will shift earnings up by more than $400,000 compared to an average teacher. The symmetry of the calculations prevail: A poor teacher at the 16th percentile (100-84) produces a negative outcome of $400,000 compared to an average teacher.

Effect of Good Teachers on the Economy

What would happen, Hanushek wonders, to aggregate economic growth if poor teachers were replaced with good teachers, closing the achievement gap with Finland ( a high performing educational achievement country)? Here’s Hanushek’s startling estimate:

“Closing the achievement gap with Finland would, according to historical experience, have astounding benefits, increasing the annual growth rate of the United States by 1 percent of GDP. Accumulated over the lifetime of somebody born today, this improvement in achievement would amount to nothing less than an increase in total U.S. economic output of $112 trillion in present value. (That was not a typo—$112 trillion, not billion.)” (Author’s emphasis)